Question 1

Which method of analyzing the cost of life insurance does not consider the cash value of the policy in the analysis?

Accepted Answer

A) traditional net cost method 
B) net payment cost index 
C) the Linton Yield 
D) the surrender cost index 
A) traditional net cost method 
B) net payment cost index 
C) the Linton Yield 
D) the surrender cost index

Question 2

Life insurance policy reserves

Accepted Answer

A) are always equal to the policy's cash surrender value. 
B) are a major asset of life insurance companies. 
C) are paid to the beneficiary when the insured dies. 
D) are a major liability of life insurance companies. 
A) are always equal to the policy's cash surrender value. 
B) are a major asset of life insurance companies. 
C) are paid to the beneficiary when the insured dies. 
D) are a major liability of life insurance companies.

Question 3

Some life insurers sell insurance directly to the public by using telephone representatives or fee-only financial planners.As the marketing expenses are substantially lower,the insurer can pass the savings on to the purchaser.The life insurance sold in this manner is called

Accepted Answer

A) low-load life insurance. 
B) preferred risk life insurance. 
C) ordinary life insurance. 
D) industrial life insurance. 
A) low-load life insurance. 
B) preferred risk life insurance. 
C) ordinary life insurance. 
D) industrial life insurance.

Question 4

The difference between the present value of future benefits payable under a life insurance policy and the present value of net premiums for the policy is the policy's

Accepted Answer

A) retrospective reserve. 
B) policyholders surplus. 
C) prospective reserve. 
D) admitted assets. 
A) retrospective reserve. 
B) policyholders surplus. 
C) prospective reserve. 
D) admitted assets.

Question 5

Which of the following statements about the yearly-rate-of-return method (also known as the Belth method)of calculating the yearly rate of return for a life insurance policy is (are)true?
I.The formula requires the use of benchmark prices per $1,000 of protection.
II.The main drawback of the formula is its complexity,necessitating the use of a computer to calculate the rate of return.

Accepted Answer

A) I only 
B) II only 
C) both I and II 
D) neither I nor II 
A) I only 
B) II only 
C) both I and II 
D) neither I nor II

Which method of analyzing the cost of life insurance does not consider the cash value of the policy in the analysis?

Life insurance policy reserves

Some life insurers sell insurance directly to the public by using telephone representatives or fee-only financial planners.As the marketing expenses are substantially lower,the insurer can pass the savings on to the purchaser.The life insurance sold in this manner is called

The difference between the present value of future benefits payable under a life insurance policy and the present value of net premiums for the policy is the policy's

Risk and Its Treatment

Insurance and Risk

Introduction to Risk Management

Advanced Topics in Risk Management

Types of Insurers and Marketing Systems

Insurance Company Operations

Financial Operations of Insurers

Government Regulation of Insurance

Fundamental Legal Principles

Analysis of Insurance Contracts

Life Insurance

Life Insurance Contractual Provisions

Annuities and Individual Retirement Accounts

Health-Care Reform; Individual Health Insurance Coverages

Employee Benefits: Group Life and Health Insurance

Employee Benefits: Retirement Plans

Social Insurance

The Liability Risk

Homeowners Insurance,section I

Homeowners Insurance,section II

Auto Insurance

Auto Insurance and Society

Other Property and Liability Insurance Coverages

Commercial Property Insurance

Commercial Liability Insurance

Crime Insurance and Surety Bonds

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Exam 13: Buying Life Insurance

Which method of analyzing the cost of life insurance does not consider the cash value of the policy in the analysis?

Life insurance policy reserves

Some life insurers sell insurance directly to the public by using telephone representatives or fee-only financial planners.As the marketing expenses are substantially lower,the insurer can pass the savings on to the purchaser.The life insurance sold in this manner is called

The difference between the present value of future benefits payable under a life insurance policy and the present value of net premiums for the policy is the policy's

Risk and Its Treatment

Insurance and Risk

Introduction to Risk Management

Advanced Topics in Risk Management

Types of Insurers and Marketing Systems

Insurance Company Operations

Financial Operations of Insurers

Government Regulation of Insurance

Fundamental Legal Principles

Analysis of Insurance Contracts

Life Insurance

Life Insurance Contractual Provisions

Annuities and Individual Retirement Accounts

Health-Care Reform; Individual Health Insurance Coverages

Employee Benefits: Group Life and Health Insurance

Employee Benefits: Retirement Plans

Social Insurance

The Liability Risk

Homeowners Insurance,section I

Homeowners Insurance,section II

Auto Insurance

Auto Insurance and Society

Other Property and Liability Insurance Coverages

Commercial Property Insurance

Commercial Liability Insurance

Crime Insurance and Surety Bonds

Filters